#  DOL Issues Proposed Rule Updating Regular Rate Requirements

Written on March 28, 2019.

Today, for the first time in more than 50 years, the U.S. Department of Labor today announced a proposed rule to clarify and update the regulations governing regular rate requirements.

Regular rate requirements define what forms of payment employers include and exclude in the "time and one-half" calculation when determining workers' overtime rates.

Under current rules, employers are discouraged from offering more perks to their employees as those perks may be vaguely defined in calculating an employees' regular rate of pay. The proposed rule focuses primarily on clarifying whether certain kinds of perks, benefits, or other miscellaneous items must be included in the regular rate. According to the DOL, because these regulations have not been updated in decades, the proposal would better define the regular rate for today's workplace practices.

The Department proposes clarifications to confirm that employers may exclude the following from an employee's regular rate of pay:

• the cost of providing wellness programs, onsite specialist treatment, gym access and fitness classes, and employee discounts on retail goods and services;

• payments for unused paid leave, including paid sick leave;

• reimbursed expenses, even if not incurred "solely" for the employer's benefit;

• reimbursed travel expenses that do not exceed the maximum travel reimbursement under the Federal Travel Regulation System and that satisfy other regulatory requirements;

• discretionary bonuses, by providing additional examples and clarifying that the label given a bonus does not determine whether it is discretionary;

• benefit plans, including accident, unemployment, and legal services; and

• tuition programs, such as reimbursement programs or repayment of educational debt.

The proposed rule also includes additional clarification about other forms of compensation, including payment for meal periods, "call back" pay, and others. The public may submit comments about this proposed rule by 11:59 pm on May 28, 2019.

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 ![Kathleen J. Jennings](https://wimlaw.com/images/resources/articles/2020/06/kathleen-portrait-300.jpg)

 Kathleen J. Jennings

Former Principal

Kathleen J. Jennings is a former principal in the Atlanta office of Wimberly, Lawson, Steckel, Schneider, &amp; Stine, P.C. She defends employers in employment matters, such as sexual harassment, discrimination, Wage and Hour, OSHA, restrictive covenants, and other employment litigation and provides training and counseling to employers in employment matters.

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